Autoblog Green reports Teamsters Local 986 are aiding Uber drivers in organizing an association open to all app-based commercial drivers — such as Lyft and Sidecar — to gain better treatment from their employer. This follows a protest earlier this week at the service’s headquarters in Santa Monica, Calif., where Los Angeles area drivers voiced their frustrations over a decision where owners of 2010 or older vehicles had less than two weeks to acquire a newer vehicle to remain a part of Uber Black or Uber SUV, as opposed to other markets where drivers had months to do the same.

In addition, the L.A. drivers are throwing their support for California Legislature Bill AB 2293, which would mandate all app-based ridesharing services to purchase insurance for any vehicle in service from the time the driver turns on the app, to the time the driver turns the app off. The drivers believe the insurance mandate would both “serve the public interest and not pose a financial hardship” to Uber, currently valued at $18.2 billion.

The insurance angle may be the best hope for the traditional industry to fight back. Livery insurance is hard to find and outrageously expensive. OTOH, perhaps Uber can self-insure, or even disrupt the conventional livery insurance market.

As a frequent Uber user (somewhere over 100 rides) I have definitely seen cracks starting to appear in the service. As I see it, their business model is not really scaleable. Those of us regularly using car services know that the supply of good drivers in clean, late model cars is extremely short. This is fine with the low priced operators such as All-7s who make no bones about an old car and operator of dubious pedigree. Uber is not cheap and the problem is, as it grows, it needs more of what is a limited asset. And it needs to keep those assets busy enough to justify their vehicle expense without instigating longer customer wait times. A very delicate balance I would not like to have to manage myself.

Another vulnerability is that due to fact they are merely a “facilitator” (which is their legal basis that allows them to operate in most markets) their ability to provide meaningful customer service is extremely limited. Talking to other users, some of us have had some serious problems (mostly drivers lending out their iPhones to other drivers & cars), none of which felt that Uber addressed properly. For instance, you can communicate only via email and after about 3 on the same subject you will receive a terse “we can help you no further in this matter, goodbye.” Refunds are almost impossible to get and a chargeback is your only recourse.

I think their culpability will only be really tested when someone is attacked, killed or injured while riding in an Uber hired vehicle. At some point (tragically) this will happen and a ruling against Uber may destroy the basis for their entire business model.

If not already done, it should be quite possible to offer a decentralized Uber like service. Or, at a minimum, relocate assets to less ambulance chaser infested locales offshore. Reducing the attack surface visible to the leeches, so to speak. Even in over regulated, dystopian hellholes, giving an online “friend” a lift when he’s visiting your town, has got to be hard for the scum to “crack down on”/use as an excuse to steal some more.